F – Base Case iCDS 84bps, Negative Case iCDS 174bps, 2031 7.450% Bond YTW of 5.214%, iYTW of 4.560%, Ba1 Rating from Moody’s, IG4 (equivalent to Baa2) Rating from Valens, Low Refinancing Need
October 10, 2025
- Credit markets are slightly overstating Ford’s credit risk with a YTW of 5.214% and a CDS of 155 bps relative to an Intrinsic YTW of 4.560% and an Intrinsic CDS of 84 bps. Furthermore, Moody’s is overstating the firm’s fundamental credit risk, with its speculative Ba1 credit rating two notches below Valens’ IG4 (Baa2) credit rating.
- Incentives Dictate Behavior™ analysis highlights positive signals for credit holders. Management’s compensation framework should encourage enhancements across all three key value drivers: sales, margins, and asset utilization, which could lead to Uniform ROA expansion and increased cash flows available for obligations.
- Earning Call Forensics™ of the firm’s Q2 2025 earnings call (07/30/2025) highlights management is confident their strong cash flow solidifies the balance sheet and that their recent investment in Ford Pro expands their service capacity.